Acreage Holdings enters into $10M private placement

Acreage Holdings has entered into subscription agreements with certain institutional investors to issue units by way of a brokered private placement at a price of $833.33 per Unit, for gross proceeds to the Company of $10M. Each Unit will consist of: $1,000 principal amount of non-recourse unsecured convertible notes, reflecting a 16.67% original issue discount, convertible into that number of Class E subordinate voting shares of the Company at the Conversion Price; and Fixed Share purchase warrants, with each Warrant exercisable to acquire one Fixed Share at the Exercise Price at any time on or before the date which is 60 months after the closing date of the Offering. The number of Warrants to be issued to each Investor shall be the quotient obtained by dividing the aggregate $10M subscription amount of the Units by the Exercise Price. The Company is party to an arrangement agreement with Canopy Growth Corporation dated April 18, 2019, as amended, relating to the proposed acquisition of all issued and outstanding Fixed Shares. The Fixed Share Acquisition is anticipated to occur immediately after the acquisition of the Class D subordinate voting shares of Acreage pursuant to the plan of arrangement under the Business Corporations Act in accordance with the arrangement agreement dated October 24, 2022, as amended, among the Company, Canopy and Canopy USA. Upon the closing of the Acquisitions, Canopy USA will own 100% of the issued and outstanding shares of Acreage. Closing of the Offering is expected to occur on or about June 6, 2024 and is subject to customary closing conditions. The Company will deposit the net proceeds of the Offering in a segregated account and intends to use the same for working capital and general corporate purposes.